State government rejects plans for Google HQ in Sydney

By Alexandra Smith & Lisa Visentin

The state government has rejected a plan to create a Silicon Valley-style technology hub on the old rail yards near Redfern, leaving tech giant Google once again searching for Australian headquarters.

The hub, which would have created as many as 19,000 jobs, would have been Google’s new base but cabinet’s infrastructure committee last week rejected the proposal because it did not meet a “uniqueness test”.

However, the proposal failed at the first hurdle after the government stated its preference for the land, which is owned by Transport for NSW, to be developed through a competitive open process.

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Despite the decision of the cabinet committee, a senior government source said some ministers were “working to salvage the deal” amid concerns that Google could abandon Sydney.

Responding to the decision on Tuesday, Mirvac said its proposal was "in line with various government objectives including the Greater Sydney Commission, UrbanGrowth and JobsforNSW strategies".

As part of its plan, Mirvac proposed to transform the site into a multi-use precinct, which included commercial, arts and culture, retail and residential space as well as "significant public domain works".

"The proposal also included substantial infrastructure works with an upgrade of Redfern Station and mixed use integrated station development, as well as a new land bridge linking Australian Technology Park and North Eveleigh," a Mirvac spokeswoman said.

The hub would have been Google’s new base but cabinet’s infrastructure committee has rejected the proposal.Credit:Ben Rushton

"Mirvac remains firmly committed to working closely with the government to realise the vision of a world-class arts and innovative precinct with housing diversity, public spaces and sustainable outcomes."

The government's decision comes exactly one year after Google walked away from plans with the state's developer Urban Growth to convert the White Bay power station in Rozelle into its Australian headquarters.

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The move was a major blow to the government's aim to convert that area into a technology hub, as well as a source of embarrassment after Google cited the area’s poor transport links as its reasons for abandoning the site.

When asked about its ongoing search for an Australian headquarters, a Google spokesman said: “We are assessing a number of options.”

Under the government’s rules, unsolicited proposals must pass a uniqueness test to progress to the next stage and be able to prove that the development cannot be readily delivered by competitors.

As well as uniqueness, a proposal must also demonstrate “value for money and strategic fit with government objectives”.

Mirvac was formally informed on Friday by the Department of Premier and Cabinet that the government had decided it would not proceed with the proposal.

The decision means that Mirvac and Google will have to compete against other potential bidders in a bid to make the Redfern tech headquarters a reality.

Mirvac was advised the competitive process would begin in the coming months.

Transport for NSW owns about 12 hectares of land in the Redfern area which includes the Carriageworks site and part of the rail corridor.

In 2015, Mirvac won the tender to buy the neighbouring Australian Technology Park from the state government with a $263 million offer.